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Jakarta - Indonesian police said they evacuated a neighbourhood on the outskirts of the capital on Saturday after discovering a bomb in a raid on suspected Islamic militants who were planning to attack the presidential palace.

National Police spokesperson Boy Rafli Amar said people living within a 300m radius of the boarding house that was raided were evacuated. Police explosive experts were at the scene.

Amar said two men and one woman were arrested. The bomb was encased in a pressure cooker, a police photograph broadcast on TV showed.

Umar Surya Fana, the police chief of Bekasi, a Jakarta satellite city where the evacuated neighbourhood is located, said the two men were arrested shortly after leaving the boarding house. The woman was arrested in the boarding house.

Fana said that the militants were monitored by the counter-terrorism squad and that police believed they had been planning to bomb the presidential palace during a guard-changing ceremony that is a tourist attraction in Jakarta.

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